Big tax rise on empty homes as government clamps down

Councils across England will have new powers to charge dramatically more council tax on homes left empty for many years following an amendment to a government Bill.

Introduced in March, this legislation originally contained provision for councils to double the rate of tax on properties that had been empty for two years or more.

However, the government is now going further and introducing an amendment that would allow councils to triple the council tax on homes left empty for five to 10 years and quadruple it on those empty for more than a decade.

Homes which have been empty for between two and five years would still be subject to the Council Tax bill being doubled under the proposal.

Housing Secretary James Brokenshire says: “We’re giving councils extra flexibility to increase bills and incentivise owners to bring long-standing empty homes back into use."

Currently, there are just over 200,000 homes empty for six months or more in England, down from 300,000 in 2010 according to government figures: Whitehall says the drop came in 2013 and more recent years after councils were given powers to charge a 50 per cent premium on council tax bills.

The vast majority of councils have introduced 50 per cent premiums on long-term empty homes. Where councils have applied the premium consistently every year, there has been a nine per cent fall in the number of homes being charged the premium.

Decisions on whether to charge a premium, and the exact rates to be charged will remain a matter for councils, taking local circumstances into account. 

It is anticipated that councils will be able to charge 100 per cent premiums from April 2019, 200 per cent premiums from April 2020 and 300 per cent premiums from 2021.

This does not apply where owners can demonstrate that their properties are genuinely on the market for sale or rent, or in cases of hardship. Councils will also need to take into account the issues of low-demand areas.

Since 2013, councils have been able to charge a 50 per cent premium on the council tax bills of owners of homes empty for two years or more. A total of 291 out of 326 councils applied an empty homes premium in 2017 to 2018. All but three are charging the premium at the maximum 50 per cent rate.